Unfortunately, the world needs you to be financially illiterate. Economies need financially dumb people. How else will people continue to spend money they don’t have, on things they don’t need, to impress people they don’t like. Or who is going to buy those expensive overpriced investments when the rich are selling them off. Not understanding the fundamentals of how money moves in the world is dangerous and risky. It creates victims, and life is not very kind to victims. This is one hard truth about money poor people don’t like to hear – you risk becoming a victim if you don’t develop your financial literacy. Before we move on, be sure to subscribe to After School Africa for more insightful videos like this.
1. You Are Responsible for Your Financial Education
Growing up, many of us were make to believe that studying hard and getting good grades qualifies you to secure a good job with excellent benefits; which automatically makes your life beautiful. As we got older, we realized that being a good student and being good money are two different things.
If you are interested in the business of making money, you must learn how money works so you can make it work for you, so that you don’t become a victim. You need to understand your current finances, accounting, investing, markets and laws. You also need to understand the difference between asset and liability. The more you broaden your finance skills, the more successful you will become. People don’t like to hear this became it makes them accountable. They prefer to just assume that the society is deliberately anti-poor. But financial knowledge is out there for anyone who wants to get it. You just have to accept that it is your responsibility to get it.
2. You don’t have Money Problem, you have skill problem
People don’t like to hear that, to a large extent, they are responsible for their financial growth or decline. The process is just faster or slower depending on where you are starting from. It’s more comfortable to assume that it’s entirely the fault of the government, environment, or the economy. Most countries no longer have a feudal economic system where you are either an elite or a peasant. In most societies, anyone with the right skillset and knowledge can rise above poverty. The problem many people have is finding the dedication, focus and discipline required to develop relevant skills to industry standard.
People who are comfortable with basic and mediocre skill level shouldn’t blame anyone for their average financial status. The more value you can deliver to the market, the more money you get paid. Your government and NGOs may come up with skill acquisition programs, but it is entirely your responsibility to develop your skill to command a higher income. If you are constantly running out of money, your problem is not lack of money but lack of skill. If you have an idea but don’t have the capital to start a business, your problem is not a lack of capital but a lack of skill to negotiate, generate money, and manage limited resources. If you cannot get a job, your problem is not due to a lack of jobs, but a lack of networking skills or lack of creativity. Stop focusing on money and start focusing on developing the skills you need to solve your problems.
3. Money or the lack of money is a result of your emotions.
Two people working in the same company and earning the same salary may have a different relationship with money. One person sees his salary as something to look forward to so that he can buy that item to impress his friends. The other person sees her salary as something to help fund her advanced skill development and investment. It’s usually not about how much you earn; it’s what you do with it. And what you do with your money is a result of how you manage your emotions.
Our emotional response towards money often stems from childhood. We are influenced by our parents’ emotional response to money. Add to that the fact that financial education is not taught in formal education. So we have a bunch of adults with little to no financial roadmap making bad financial decisions. Sometimes our emotions towards money are so strong that we start to hate money because we believe that it is the cause of all of our problems. This leaves people living all their adult life in the rat race for money. A very important step towards financial freedom is evaluating your emotions towards money. Are you driven by fear, anger, greed, or shame? Or by value-creation, purpose and abundance?
4. Earning high Income and being rich are two different things
Most high income earners get paid huge salaries, bag huge endorsement deals, sign up with record labels and so on. But, they may not be financially wealthy. The difference between earning a high income and being financially rich boils down to how they use their money. Note that the emphasis is on the financial-rich because being rich is not all about how much money you have. You can be relationship-rich, marital-rich, health-rich, intellectual-rich, spiritual-rich or rich in other areas of your life. I just needed to clarify that.
Both high income earners and rich people buy luxuries. The difference is that high earners buy luxury with money earned from their work while rich people buy them with money made from their money working for them. High income earners depend on their high paying talent, or skills to make money, rich people leverage the talents, skills, money, knowledge and systems of other people to generate wealth. Buying luxury to look rich will not make you rich.
5. Work to learn not to earn
This is especially for young people. Realistically, as you get older and have more responsibility, we want more stability and relative predictability with your income. But when you are still young with little experience, network and skill level, your primary focus with work should be to learn and not which job has the biggest paycheck.
Your goal should be to find a job where you can learn and develop valuable skills. It may not be the best paying job at the moment, but what you learn from the job could be worth more in the future than any present higher paycheck. And as you get older, you are more advanced to qualify for better and bigger opportunities.
6. Learn to sell
A woman with a master’s degree in English literature asked Robert Kiyosaki how she can become a best-selling author like him. He told her to enroll in a sales-training course. “You aren’t serious, are you…” she said. Robert picked up the book on the coffee table and said, “There’s a reason we say ‘best-selling author,’ and not ‘best-writing author.’” Selling is a crucial skill if you want to be financially rich, he explained.
If you think selling is reserved for greedy and selfish people, you’ve got it all wrong. Human interaction is mostly about selling. You are constantly selling your brand and perception even if you don’t know it; people sell their religious beliefs. In relationships, people are constantly selling their commitment. Selling is a way of life. If you find something you believe will be of value to other people, wouldn’t you try to convince people about it? No doubt the world today has become a lot about materialism, and people are willing to sell worthless, even harmful things just to make money. You can be a great salesman and still sleep well at night with a clear conscience by selling what you believe in.
7. You become what you study
Everyone wants to be rich someday, but only a few people sit down to study how this thing called money really works and studying the lifestyle of people who achieved great wealth. Few people take the time to become the best at what they do so that they can make more money. You become what you spend your time on. If you surround yourself with average people and waste your time on trivial things that add no value to your financial life, it is unlikely that you will achieve financial independence. Earl Nightingale puts it clearly, “You become what you think about most of the time”. You cannot become financially independent if you don’t study and discuss the finances and the economics of money. If you believe it is vain to talk about money, you cannot develop the capacity to attract it. Decide what you want from life, then unapologetically study and learn from people who have gotten what you want.
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